Reading Money Flow: The Basics of Supply and Demand
Prices move because buying money and selling money push against each other. Experienced investors often check the direction of money before the news. The problem: individuals cannot see institutional trades in real time. But direction can be approximated well enough from public price and volume alone.
Direction from price times volume
InverseOne approximates net money flow as change % × price × volume. A day when the price rises on heavy trading is a day the incoming money won; a fall on heavy trading means the leaving money won. The sign gives direction, the size gives intensity.
This is an estimate, not actual institutional data. But computed the same way every day, it reveals which sectors and stocks money is moving toward. What matters is not one day's value but the persistence of direction.
Streaks matter more than single days
One day of inflow can be noise. Several consecutive days in the same direction is a different story: large buyers leave multi-day footprints when they accumulate. That is why the flow reading always pairs today's value with how many days the direction has lasted.
Volume is the companion check. A price rise on unusually heavy volume suggests new money arrived; a rise on thin volume carries little force.
Practical order: sector first, then stock
Money usually moves at the sector level before the stock level. So the reading order is sector → stock. Check which sector money entered today, then look at the top inflow names inside it. When sector flow and stock flow point the same way, the signal is more reliable.
The home screen implements this order directly: the market map shows sectors, the ranking shows stocks, and the daily briefing summarizes each day's movement.
Frequently asked questions
- How is this different from paid supply-demand data?
- Exchange data aggregates actual trades by investor type. The flow estimate approximates direction from public prices and volume only. It is less precise, but free and consistent day to day.
- Should I buy the day's top inflow stock?
- No. The top inflow name has usually already risen that day. Check whether the inflow just started or has run for days and overheated. Money flow is a tool for narrowing a watchlist, not a trade signal.
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The money flow and stock signals this service shows are estimated, for-reference information based on price and volume. It is not a solicitation to buy or sell any security, nor investment advice. It is a prior-close daily batch, not real-time quotes, and all investment decisions and responsibility are your own. The Trade button is a convenience link to your chosen brokerage's app/website; orders are placed directly at the brokerage and InverseOne is not involved in any order.